August 8, 2022

G7: Bitcoin failed as a means of payment and savings

Bitcoin and other cryptocurrencies have not become a “reliable and attractive” means of payment and savings, but stablecoins have potential. This is stated in the report of the “Big Seven” (G7).

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The group which includes the USA, Japan, Germany,France, Great Britain, Italy and Canada, published a report on stable coins. The authors of the document recognized that global stablecoins, although not risk free, can solve the problem of slow and expensive money transfers.

At the same time, cryptocurrencies cannot serveeffective solution, since it is “extremely unstable”, difficult to use, have scalability limitations and problems with management and regulation.

“Thus, cryptocurrencies serve as a highly speculative asset class for certain investors and those engaged in illegal activities, rather than a means of payment,” - the report says.

On the other hand, stablecoins also do not haveglobal regulation and may be unstable. But, subject to the rules, “stable coins” can be convenient for use as a means of payment and savings, experts say G7.

“No global stablecoin project shouldstart work until the legal, regulatory and supervisory problems are duly resolved, risks are mitigated through the introduction of appropriate designs and compliance with clear proportional regulatory standards, ” - emphasized the authors of the document.

Recall that the G7 already warned of a tough regulatory approach
Facebook's stable coin project Libra. Earlier, the group published a report on the risks to the stability of the global financial system, which are widespread stablecoins.